View Full Version : Universal Parks & Resorts and Busch Entertainment Corp

11-03-2009, 11:21 AM
With a virtual for-sale sign planted in front of Shamu Stadium, AB InBev wants out of the theme-park business presenting a rare opening for other big tourism players to nab some premium assets.

Think about this: Universal Parks & Resorts and Busch Entertainment Corp. Together they would create a theme-park empire that could begin to rival Walt Disney World.

It's a buyer's market. And there are some buyers for which this deal makes more sense than others.

Merlin Entertainments Group, the English operator of four Legoland parks, the London Eye and Madame Tussauds famous wax figures, is majority owned by the Blackstone Group, the same private-equity firm that holds a 50 percent interest in Universal Parks & Resorts.

Merlin holds the most intrigue as a potential bidder because common ownership of Universal and the 10 parks in five states that belong to AB InBev's Busch Entertainment could produce a marketing force capable of challenging Disney's four Orlando parks.

Universal first teamed up with SeaWorld and Busch Gardens back in 1996 to sell tickets in Orlando and California that grant admission to both companies' parks in those locations. The package, known today as the "flex ticket," is especially popular among British tourists because it's good for 14 days and even includes discounts on parking and some free transportation between the parks.

Clearly Universal and Busch Entertainment already recognize the benefits of working together. Imagine if they harnessed their collective advertising and brand power in other ways.

More than just ticket packages, hotel rooms, expanded transportation options or even a dining plan shared between the two properties could prove to be smart additions, especially if such a partnership were structured to appeal to domestic visitors as well.

That could lure more people off Disney property for longer periods of time, hindering Disney's strategy to keep its guests at its own parks, hotels and restaurants.

A spokeswoman for Blackstone would not comment.

If Busch Entertainment had come up for sale a little as three or four years ago, a bidding war would have escalated the price off the charts. As if we need reminding, all bets are off in today's limping economy.

All of the big parks are hurting right now, evidenced by their current hotel-night giveaways. That doesn't necessarily mean Blackstone or another company wouldn't be able to pull off a deal for Busch Entertainment. The purchase price is projected to land in the $2 billion to $4.5 billion range.

Could Disney be a player, too? I doubt it.

Disney Chief Executive Officer Bob Iger dodged a question at Tuesday's shareholder meeting about whether Disney was pursuing a bid for Busch. His response amounted to a polite no comment, saying the company doesn't discuss potential acquisitions publicly.

Industry watchers have said Disney explored Busch Entertainment when it first came up for sale. But it would be surprising to see the company chase such a deal.

Disney traditionally creates its own characters and attractions from scratch, rather than take over another company's. It would be hard to transfer Disney's unique feel to already established parks. And it seems it would be harder to make the parks a cohesive unit given that SeaWorld, Discovery Cove and Aquatica are about nine miles down Interstate 4.

Universal, on the other hand, is about six miles to the north along International Drive.

Orlando Sentinel 10th March 2009